Background
In 2021, the Springfield Water and Sewer Commission was chosen among a field of national applicants to receive a $250 million WIFIA loan from the U.S. Environmental Protection Agency (EPA). EPA's WIFIA program provides low-interest, long-term flexible financing to enable upgrades to water and wastewater infrastructure of regional or national importance. With very few loan or grant programs available to support such work in the water sector, the WIFIA program is highly competitive. The Commission is the first utility in Massachusetts to receive a WIFIA loan.
View an interactive map to learn more about WIFIA-supported projects
View quarterly project and financial progress reports
Benefits
The $250 million WIFIA loan will finance the accelerated design, construction, and implementation of critically important upgrades throughout the Commission's water and wastewater system. WIFIA financing provides several valuable benefits for ratepayers:
Compared to traditional funding sources such as market-rate bonds, the WIFIA loan will save Commission ratepayers approximately $60 million in borrowing costs over its 30-year lifespan. The interest rate for a WIFIA loan is fixed for the entire life of the loan, and is tied to the U.S. Treasury rate on the day of closing. (The Commission closed on its WIFIA loan on August 19, 2021.)
WIFIA financing will support the Commission’s $750 million capital improvement program (CIP). The CIP includes critical upgrades that are unavoidable due to the age of the Commission’s existing infrastructure or evolving regulatory requirements. WIFIA’s flexible loan terms will compress a large portion of the CIP to be implemented within under 10 years rather than 20, reducing the risk of infrastructure failure or costly non-compliance with state or federal regulations.
The WIFIA program allows for utilities to customize the terms of the loan agreement. This flexibility provides the opportunity for innovative approaches to traditional financing. The ability to shape principle payments and debt schedules to accommodate other financial obligations can be used to support rate stability, avoiding unpredictable large variations in year-to-year rate setting. WIFIA’s flexible loan terms will allow for the substitution of other legislative aid programs, grant funding, or financing opportunities should they become available in the future.
This structure also enables the Commission to leverage traditional financing sources to meet WIFIA’s 51% match requirement. One such source is the Drinking Water and Clean Water Trust State Revolving Fund (SRF), which is administered through the Massachusetts Department of Environmental Protection (MassDEP).
SWSC's Water and Wastewater Infrastructure Renewal Program
The Commission's 20-year Capital Improvement Program (CIP), submitted to WIFIA as the "WIFIA Water and Wastewater Infrastructure Renewal Program," includes over 20 projects of critical need. All projects are intended to maximize ratepayer dollars by addressing multiple challenges at once, ranging from climate resiliency to infrastructure renewal to regulatory compliance.
Featured WIFIA-financed Projects
| Featured Project | Featured Project Title | Funding Source |
 | New West Parish Filters Water Treatment Plant | WIFIA |
 | York Street Pump Station & Connecticut River Crossing Project | SRF |
 | Biological Nutrient Removal & Wastewater Treatment Facility Improvements | WIFIA & SRF |
 | Water Distribution & Sewer Collection System Renewal | WIFIA |
For a full list of all WIFIA-funded projects and projects funded as part of the 51% match, see the FY22 Three-Year Capital Improvement Program (adopted June 23, 2021).